Membrane distillation (MD) is one of the non-isothermal membrane separation processes used in various applications such desalination, environmental/waste cleanup, food, etc. It is known since 1963 and is still being developed at laboratory stage for different purposes and not fully implemented in industry. An abrupt increase in the number of papers on MD membrane engineering (i.e. design, fabrication and testing in MD) is seen since only 6 years ago. The present paper offers a comprehensive MD state-of-the-art review covering a wide range of commercial membranes, MD membrane engineering, their MD performance, transport mechanisms, experimental and theoretical modeling of different MD configurations as well as recent developments in MD. Improved MD membranes with specific morphology, micro- and nano-structures are highly demanded. Membranes with different pore sizes, porosities, thicknesses and materials as well as novel structures are required in order to carry out systematic MD studies for better understanding mass transport in different MD configurations, thereby improving the MD performance and looking for MD industrialization.